Many cryptocurrencies are showing signs of buying but traders are cautious as they are yet to break above their critical resistance levels.
The White House and Senate leaders finally agreed to a massive stimulus of $2 trillion to support the economy and Americans who are suffering due to the COVID-19 pandemic. While the equity markets are celebrating with a rally, Binance CEO Changpeng Zhao has projected a bullish figure of $100,000 for each Bitcoin. Zhao believes that with most Bitcoin in the hand of long term holders, even if a small portion of the new stimulus flows into Bitcoin, a market capitalization of $2 trillion is achievable.
Trader Tone Vays sounded increasingly bullish on Bitcoin. He said that if Bitcoin breaks above $6,800, the possibility of it dropping to new lows below $3,800 reduces to 15%. “Going above $6,800 would maybe give me 85% confidence we’re not going to go below this,” Vays said.
Daily cryptocurrency market performance. Source: Coin360
While several nations are announcing stimulus measures to counter the slowdown due to the coronavirus pandemic, China’s central bank is working towards issuing its central bank digital currency (CBDC). A report by Global Times suggested that China has completed the development of the basic functions of the CBDC and is now drafting laws related to its use. Digital Renaissance Foundation managing director Cao Yan believes that a digital yuan will give the Chinese central bank a great tool to enact a zero or negative interest rate policy.
While several crypto enthusiasts are bullish on the future of cryptocurrencies, CEO and chief global strategist of Euro Pacific Capital Inc. Peter Schiff remains overwhelmingly critical of Bitcoin. Schiff recently tweeted: “Only fools are choosing Bitcoin.”
BTC/USD
Bitcoin (BTC) broke and closed (UTC time) above the 20-day EMA on March 24, which triggered our buy suggested in the previous analysis. However, the bulls are struggling to sustain the price above the 20-day EMA, which is a bearish sign.
BTC USD daily chart. Source: Tradingview
Currently, the bears are defending the $7,000 level while the bulls are attempting to keep the BTC/USD pair above the breakout level of $6,435. The 20-day EMA is flattening out and the RSI is just below the midpoint, which suggests a balance between buyers and sellers.
If the bulls can push the price above $7,000, a move to the 200-day SMA at $8,343 is possible.
Conversely, if the price dips below $6,435 once again, a drop to $5,660.65 is possible. If this support also gives way, the next level to watch out for is $5,000. Therefore, the traders can keep a stop loss of $5,600 on the long positions.
ETH/USD
Ether (ETH) is trading close to the midpoint of the $117.090-$155.612 range. On the upside, the 20-day EMA is at $152.1, which is close to the resistance of the range. Hence, we expect the bears to defend this level aggressively.
ETH USD daily chart. Source: Tradingview
If the ETH/USD pair turns down from $155.612, a few more days of range-bound action is likely. However, if the bulls can break above $155.612, the pair is likely to start a new uptrend. Therefore, we retain the buy proposed in the previous analysis.
Our view will be invalidated if the pair turns down from the current levels or from the overhead resistance and plummets below $117.090. Below this level, a drop to $100 is likely.
XRP/USD
XRP is facing selling close to the resistance line of the descending channel. Above this level, we anticipate the bears to again mount a stiff resistance at $0.17468. The 20-day EMA is also just above this level at $0.175.
XRP USD daily chart. Source: Tradingview
If the XRP/USD pair turns down from the current levels or from the overhead resistance at the 20-day EMA, a drop to $0.144 is possible.
Conversely, if the bulls can push the price above the 20-day EMA, the pair is likely to attract buyers. Therefore, we retain the buy recommendation given in the previous analysis.
BCH/USD
Bitcoin Cash (BCH) has reached the resistance line of the descending channel where it is facing selling pressure. The 20-day EMA is also close to the resistance line, hence, the bears are likely to defend this level aggressively.
BCH USD daily chart. Source: Tradingview
If the price turns down from the current levels and breaks below $197.43, the BCH/USD pair can drop to $166.
However, if the bull can push the price above the channel and the 20-day EMA, it will signal a likely change in trend. Above the channel, a move to the 200-day SMA at $274 and above it to $350 is possible.
Therefore, the traders can buy on a breakout and close (UTC time) above the channel and the 20-day EMA and keep an initial stop loss of $196.
BSV/USD
Bitcoin SV (BSV) broke above the descending channel on March 23 and scaled above the 20-day EMA on the next day. This triggered our buy suggested in the previous analysis. However, the bulls are struggling to sustain the price above the 20-day EMA, which is a negative sign.
BSV USD daily chart. Source: Tradingview
If the BSV/USD pair breaks below the 200-day SMA at $160.68, a drop to $146.96 is possible. If this level also fails to hold, the pair will re-enter the channel, which will indicate that the current breakout of the channel was a bear trap. Therefore, the traders can keep an initial stop loss of $146 on the long positions.
However, if the pair rebounds off the 200-day SMA and breaks above $186, a move to $250 and above it to $326.8 is likely.
LTC/USD
Litecoin (LTC) continues to trade inside the descending channel. The bears are currently defending the resistance line of the channel. If the altcoin turns down and drops below $35.8582, a drop to $30 is possible.
LTC USD daily chart. Source: Tradingview
Conversely, if the LTC/USD pair bounces off the $38.8015-$35.8582 range, the bulls will attempt to carry it above the 20-day EMA.
If successful, we expect the pair to start an up move that can reach the 200-day SMA at $55 and above it $63.8769. Therefore, traders can buy on a breakout and close (UTC time) above the 20-day EMA and keep a stop loss of $34.
EOS/USD
EOS continues to trade inside the $2.1624-$2.4001 range. However, we anticipate the altcoin to break out of this tight range and start a directional move soon. If the bulls can push the price above the range and the 20-day EMA at $2.52, an uptrend is possible. Therefore, we retain the buy suggested in the previous analysis.
EOS USD daily chart. Source: Tradingview
Contrary to our assumption, if the bulls fail to scale the EOS/USD pair above the overhead resistance, a few more days of consolidation is likely.
The trend will turn in favor of the bears if the price breaks below the range. A drop below $2.0632 can sink the pair to $1.7213.
BNB/USD
Binance Coin (BNB) has been trading close to $12.1111 for the past few days. The failure of the bulls to push the price above the 20-day EMA shows a lack of urgency to buy at higher levels.
BNB USD daily chart. Source: Tradingview
The 20-day EMA is sloping down and the RSI remains in the negative territory, which suggests that bears have the upper hand.
If the BNB/USD pair turns down from the current levels and slips below $10.8427, it can drop to $8.4422. We do not find any reliable buy setups on the pair, hence, we remain neutral on it.
XTZ/USD
Tezos (XTZ) has been trading inside an ascending triangle pattern near the recent lows. This is a bullish reversal pattern, which will complete if the price closes (UTC time) above the overhead resistance at $1.955.
XTZ USD daily chart. Source: Tradingview
A breakout of the ascending triangle setup has a target objective of $2.9004. However, if the momentum is strong, the up move can extend to $3.30. Therefore, we retain the buy suggested in our previous analysis.
Contrary to our assumption, if the XTZ/USD pair turns down from the current levels or from the overhead resistance and breaks below the trendline of the triangle, it will invalidate the pattern.
LEO/USD
UNUS SED LEO (LEO) has been consolidating near the resistance of the $0.9081-$1.04 range for the past three days. This is a positive sign and it increases the possibility of a breakout of the range.
LEO USD daily chart. Source: Tradingview
The 20-day EMA is sloping up and the RSI is in the positive territory, which suggests that bulls have the upper hand.
A break above $1.04 will complete a bullish inverse head and shoulders pattern. Hence, we retain the buy proposed in our previous analysis.
Our bullish view will be invalidated if the LEO/USD pair turns down from the current levels. If that happens, the pair will extend its stay inside the range.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
